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India’s steel exports slumped to one of its lowest since FY19 with the country exporting just 6.7 million tonnes (mt) in April–March 2022-23, halving on a year-on-year basis, provisional data available with the Steel Ministry showed.
The fall comes on the back of an export duty imposed for six months of the fiscal and weakening demand in key markets due to economic and geopolitical headwinds.
Exports for FY22 were 13.5 mt - one of the best year’s for Indian mills while in FY21 the figure stood at 10.8 mt. In FY20, exports stood at 8.4 mt. In FY19 and FY18, exports stood at 6.4 mt and 9.6 mt, respectively.
“Primarily a six month-long duty regime and a follow-on impact of that, for at least two more months, impacted order books,” an exporter said.
Also read: Steel industry’s story in 2022 and beyond
However, Vedant Goel, MD at Neo Mega Steel LLP, said recessionary trends and duty imposition have contributed but the extent of their impact will vary depending on factors such as the market or steel type sold.
“(For instance) better prices offered by Japan and Vietnam despite the Centre lifting export duties made Indian steel exports uncompetitive,” he said.
The saving grace was India still being a net exporter of finished steel for the fiscal gone by with exports exceeding imports by 0.7 mt.
India’s finished steel exports include non-alloyed offerings, stainless steel and alloyed ones.
Imports up
On the other hand, Steel imports rose to one of highest in the last three years.
Imports stood at 6 mt, up 30 per cent YoY in FY23. In FY21 and FY20, imports stood at around 4.7 mt level for each year. In FY20, FY19 and FY18, imports were 6.8 mt, 7.8 mt and 7.5 mt, respectively, Ministry officials told businessline.
Most of the imports were in specialty steel category while some came on account of cheaper offerings mostly from Russia.
Non-alloyed offerings hit
Incidentally, the key export offerings – non-alloyed steel – was hit the hardest, primarily because of the duty levy. Non-alloyed steel exports last fiscal stood at 4.5 mt, down 64 per cent YoY. Non-alloyed steel exports in FY22 were 12.4 mt.
Indian mills had tried to counter the duty levy by ramping up on alloyed steel (also called boron steel) offers.
Although there were fewer takers, alloyed steel – which did not have tax levy – saw exports double to 2.2 mt on a YoY basis. In FY22, exports in the alloyed steel (including stainless steel) category was just 1.1 mt.
Also read: India one of the two places globally to witness growth in steel consumption: Seshagiri Rao
India’s steel majors had reported a drop in profits in the December quarter. Steel mills project improvement in number March quarter onwards.
March Trends
“There is some uptick in export trends in March over February. Imports are coming down too. We hope that the momentum sustains as price offers improve,” the exporter said.
India had been a net importer for steel for five straight months – October to February – of this fiscal. Steel shipments coming in (imports to India) saw a 28 per cent sequential decline to 28 per cent to 0.42 mt in March (against 0.58 mt in February) but increased 22 per cent YoY (0.35 mt in March 2022).
On a sequential basis, India exported 0.8 mt of steel in March, up 41 per cent over February (0.6 mt) but down 32 per cent over the year-ago-period (1.2 mt in March 2022).
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